Gulf Cooperation Council

The Cooperation Council for the Arab States of the Gulf (Arabic: مجلس التعاون لدول الخليج العربي‎), originally (and still colloquially) known as the Gulf Cooperation Council (GCC, مجلس التعاون الخليجي), is a regional intergovernmental political and economic union consisting of all Arab states of the Persian Gulf except Iraq, namely: Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, and the United Arab Emirates.[2][3] The Charter of the GCC was signed on 25 May 1981, formally establishing the institution.[4]

Cooperation Council for the Arab States of the Gulf

Flag
Logo
Map indicating GCC members
Headquarters Riyadh, Saudi Arabia
Official languagesArabic
TypeTrade bloc
Membership
Leaders
• Secretary General
Nayef bin Falah Al-Hajraf
 United Arab Emirates[1]
Establishment
• As the GCC
25 May 1981 (1981-05-25)
Area
• Total
2,673,108 km2 (1,032,093 sq mi)
• Water (%)
0.6%
Population
• 2021* estimate
65,506,958 (25th)
• Density
21.13/km2 (54.7/sq mi) (162nd)
GDP (PPP)2018 estimate
• Total
$3.655 trillion (7th)
• Per capita
$71,205 (7th)
GDP (nominal)2018* estimate
• Total
$1.638 trillion (11th)
• Per capita
$34,265 (25th)
Gini (2012) 28.7
low
HDI (2018) 0.840
very high · 45th
Currency
  1. Sum of component states' populations.

All current member states are monarchies, including three constitutional monarchies (Qatar, Kuwait, and Bahrain),[5][6] two absolute monarchies (Saudi Arabia and Oman), and one federal monarchy (the United Arab Emirates, which is composed of seven member states, each of which is an absolute monarchy with its own emir). There have been discussions regarding the future membership of Jordan, Morocco, and Yemen.[7][8]

A proposal in 2011 to transform the GCC into a "Gulf Union" with tighter economic, political and military coordination was advanced by Saudi Arabia, a move meant to counterbalance the Iranian influence in the region.[9][10] Objections were raised against the proposal by other countries.[11][12] In 2014, Bahrain prime minister Khalifa bin Salman Al Khalifa said that current events in the region highlighted the importance of the proposal.[13] The Peninsula Shield Force is the military arm of the GCC, formed in 1984.

In order to reduce their future dependence on oil, the GCC states are pursuing unprecedented economic structural reform.[14]

Founding
Heads of states of the GCC in Abu Dhabi on 25 May 1981[15][16]

The original 2,673,110-square-kilometre (1,032,093 sq mi) union comprised Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the United Arab Emirates (UAE). The unified economic agreement between the countries of the Gulf Cooperation Council was signed on 11 November 1981 in Abu Dhabi, UAE. These countries are often referred to as "the GCC states" or "Gulf countries".

Objectives

In 2001, the GCC Supreme Council set the following goals:

Oman announced in December 2006 that it would not be able to meet the 2010 target date for a common currency. Following the announcement that the central bank for the monetary union would be located in Riyadh, Saudi Arabia, and not in the UAE, the UAE announced their withdrawal from the monetary union project in May 2009. The name Khaleeji has been proposed as a name for this currency. If realised, the GCC monetary union would be the second-largest supranational monetary union in the world, measured by the GDP of the common-currency area.[18]

Other stated objectives include:

  • Formulating similar regulations in various fields such as religion, finance, trade, customs, tourism, legislation, and administration.
  • Fostering scientific and technical progress in industry, mining, agriculture, water and animal resources.
  • Establishing scientific research centers.
  • Setting up joint ventures.
  • Unified military (Peninsula Shield Force)
  • Encouraging cooperation of the private sector.
  • Strengthening ties between their people.

This area has some of the fastest-growing economies in the world, mostly due to a boom in oil and natural gas revenues coupled with a building and investment boom backed by decades of saved petroleum revenues. In an effort to build a tax base and economic foundation before the reserves run out, the UAE's investment arms, including Abu Dhabi Investment Authority, retain over US$900 billion in assets. Other regional funds also have several hundreds of billions of dollars of assets under management.

The region is an emerging hotspot for events, including the 2006 Asian Games in Doha, Qatar. Doha also submitted an unsuccessful application for the 2016 Summer Olympics. Qatar was later chosen to host the 2022 FIFA World Cup.

Recovery plans have been criticized for crowding out the private sector, failing to set clear priorities for growth, failing to restore weak consumer and investor confidence, and undermining long-term stability.[21]

The logo of the GCC consists of two concentric circles. On the upper part of the larger circle, the Bismillah phrase is written in Arabic, which means "In the name of God", and on the lower part the Council's full name, in Arabic. The inner circle contains an embossed hexagonal shape that represents the Council's six member countries. The inside of the hexagon is filled by a map encompassing the Arabian Peninsula, on which the areas of the member countries are borderless and colored in brown. On the edge of the hexagon are colors representing the flags of the six member countries.

Economy

Internal market

A common market was launched on 1 January 2008 with plans to realise a fully integrated single market.[22] It eased the movement of goods and services. However, implementation lagged behind after the 2009 financial crisis. The creation of a customs union began in 2003 and was completed and fully operational on 1 January 2015.[23] In January 2015, the common market was also further integrated, allowing full equality among GCC citizens to work in the government and private sectors, social insurance and retirement coverage, real estate ownership, capital movement, access to education, health and other social services in all member states. However, some barriers remained in the free movement of goods and services.[24] The coordination of taxation systems, accounting standards and civil legislation is currently in progress. The interoperability of professional qualifications, insurance certificates and identity documents is also underway.[25]

Monetary union

In 2014, Bahrain, Kuwait, Qatar, and Saudi Arabia took major steps to ensure the creation of a single currency. Kuwait's finance minister said the four members are pushing ahead with the monetary union but said some "technical points" need to be cleared. He added, "A common market and common central bank would also position the GCC as one entity that would have great influence on the international financial system". The implementation of a single currency and the creation of a central bank is overseen by the Monetary Council.[26]

There is currently a degree to which a nominal GCC single currency already exists. Businesses trade using a basket of GCC currencies, just as before the euro was introduced, the European Currency Unit (ECU) was long used beforehand as a nominal medium of exchange.[25] Plans to introduce a single currency had been drawn up as far back as 2009, however due to the financial crisis and political differences, the UAE and Oman withdrew their membership.[27]

Mergers and acquisitions

Companies and investors from GCC countries are active in mergers and acquisitions (M&A). Since 1999, more than 5,200 transactions with a known value of US$573 billion have been announced.[28] They are active within GCC and in cross-border M&A abroad. The investor group includes in particular a number of sovereign wealth funds.[29]

Infrastructure

The GCC launched common economic projects to promote and facilitate integration. The member states have connected their power grids, and a water connection project was launched with plans to be in use by 2020. A project to create common air transport was also unveiled.[30]

The GCC also launched major rail projects to connect the peninsula. The railways are expected to fuel intra-regional trade while helping reduce fuel consumption. Over US$200 billion will be invested to develop about 40,000 kilometres (25,000 mi) of rail network across the GCC, according to Oman's Minister of Transport and Communications. The project, estimated to be worth $15.5 billion, is scheduled to be completed by 2021. "It will link the six member states as a regional transport corridor, further integrating with the national railway projects, deepening economic social and political integration, and it is developed from a sustainable perspective." stated, Ramiz Al Assar, Resident World Bank advisor for the GCC.[31]

Saudi Arabian Railways, Etihad Rail, and national governments have poured billions into railway infrastructure to create rail networks for transporting freight, connecting cities, and reducing transport times.[31]

Politics and governance

Supreme Council

The GCC Supreme Council is composed of the heads of the member states. It is the highest decision-making entity of the GCC, setting its vision and goals. Decisions on substantive issues require unanimous approval, while issues on procedural matters require a majority. Each member state has one vote.[32]

Ministerial Council

The Ministerial Council is composed of the Foreign Ministers of all the member states. It convenes every three months. It primarily formulates policies and makes recommendations to promote cooperation and achieve coordination among the member states when implementing ongoing projects. Its decisions are submitted in the form of recommendations for the approval of the Supreme Council. The Ministerial Council is also responsible for preparations of meetings of the Supreme Council and its agenda. The voting procedure in the Ministerial Council is the same as in the Supreme Council.[32]

Secretariat General

The Secretariat is the executive arm of the Gulf Cooperation Council. It takes decisions within its authority and implements decisions approved by the Supreme or Ministerial Council. The Secretariat also compiles studies relating to cooperation, coordination, and planning for common action. It prepares periodical reports regarding the work done by the GCC as a whole and regarding the implementation of its own decisions.[32]

Monetary Council

On 15 December 2009, Bahrain, Kuwait, Qatar, and Saudi Arabia announced the creation of a Monetary Council to introduce a single currency for the union. The board of the council, which set a timetable and action plan for establishing a central bank and choosing a currency regime, met for the first time on 30 March 2010. Kuwaiti foreign minister Mohammad Sabah Al-Sabah said on 8 December 2009 that a single currency may take up to ten years to establish. The original target was in 2010. Oman and the UAE later announced their withdrawal from the proposed currency.

In 2014, major moves were taken to ensure the launch of a single currency. Kuwait's finance minister stated that a currency should be implemented without delay. Negotiations with the UAE and Oman to expand the monetary union were renewed.[26]

Patent Office
Main article: GCC Patent Office

The GCC Patent Office was approved in 1992 and established soon after in Riyadh, Saudi Arabia.[33] Applications are filed and prosecuted in the Arabic language before the GCC Patent Office in Riyadh, Saudi Arabia, which is a separate office from the Saudi Arabian Patent Office.

Peninsula Shield Force
Main article: Peninsula Shield Force

Amidst the Bahraini uprising, Saudi Arabia and the UAE sent ground troops to Bahrain in order to protect vital infrastructure such as the airport and highway system.[9][34][35][36] Kuwait and Oman refrained from sending troops.[9][37] Instead, Kuwait sent a navy unit.[38]

The secretary-general of the GCC strongly endorsed the use of international force in Libya. GCC member states joined coalition efforts to enforce the no-fly zone.[39]

In September 2014, GCC members Saudi Arabia, Bahrain, UAE and Qatar, plus pending member Jordan, commenced air operations against Islamic State of Iraq and the Levant (ISIL) in Syria.[40] Saudi Arabia and the UAE, however, are among the nations that oppose the Muslim Brotherhood in Syria, whereas Qatar has historically supported it. They also pledged other support including operating training facilities for Syrian rebels (in Saudi Arabia)[41] and allowing the use of their airbases by other countries fighting ISIL.

GCC Standardization Organization (GSO)
Main article: GCC Standardization Organization

This is the standardization organization of the GCC, and Yemen also belongs to this organization.[42]

Gulf Organization for Industrial Consulting (GOIC)
Main article: Gulf Organization for Industrial Consulting

The Gulf Organization for Industrial Consulting (GOIC) was founded in 1976 by the six GCC member states; Yemen joined the organization in 2009. It is headquartered at Doha, Qatar. The organization chart of GOIC includes the Board members and the General Secretariat. The Board is formed by member state representatives appointed by their governments.[43]

Secretaries-General
TenureNameCountry
26 May 1981 – April 1993Abdullah Bishara[44]Kuwait
April 1993 – April 1996Fahim bin Sultan Al Qasimi[45]United Arab Emirates
April 1996 – 31 March 2002Jamil Ibrahim Hejailan[46]Saudi Arabia
1 April 2002 – 31 March 2011Abdul Rahman bin Hamad Al Attiyah[47]Qatar
1 April 2011 – presentAbdullatif bin Rashid Al ZayaniBahrain

Member states

There are six member states of the union:

FlagCommon name Official nameType of government
in Englishin romanized Arabic
BahrainKingdom of BahrainMamlakat al-BaḥraynConstitutional monarchy
KuwaitState of KuwaitDawlat al-KuwaytParliamentary system, Constitutional monarchy
OmanSultanate of OmanSaltanat ʻUmanAbsolute monarchy
QatarState of QatarDawlat QaṭarAbsolute monarchy
Saudi ArabiaKingdom of Saudi ArabiaAl-Mamlaka al-ʻArabiyya as-SuʻūdiyyaAbsolute monarchy
United Arab EmiratesUnited Arab EmiratesAl-Imārāt al-‘Arabīyah al-MuttaḥidahFederal monarchy,a Constitutional monarchy
a Elective by monarchs de jure, hereditary de facto.

Sports

The union has served as a grouping for sports co-operation and competition. The GCC states have an annual Meeting of the Youth and Sports ministers to boost youth and sports initiatives in the region; in 2015, this gathering was held for the 29th time.[48] The promotion of the hosting of international sports events has also served an economic purpose for the union's countries, leading to investment and development in the region.[49]

The GCC Games, a quadrennial multi-sport event, was established by the union and first held in 2011.[50] There are numerous long-running GCC Championships for individual sports, including: the Gulf Cooperation Council Athletics Championships (first held in 1986; youth section from 2000)[51] sailing,[52] basketball,[53] swimming,[54] tennis,[55] gymnastics (senior and youth levels),[56][57] weightlifting,[58] futsal,[59] snooker,[60] and table tennis.[61]

2014 Saudi–Qatari rift
Main articles: Saudi Arabia-Qatar relations and Qatar–Saudi Arabia diplomatic conflict

Qatar's support for the Muslim Brotherhood across the Middle East-North Africa (MENA) region, Hamas and radical Islamists in Libya has led to increasing tensions with other Arab states of the Persian Gulf.[62][63][64] These tensions came to a head during a March 2014 meeting of the GCC, after which the UAE, Saudi Arabia and Bahrain announced the recall of their ambassadors to Qatar.[65][66][67][68]

Some financial economists have interpreted the 2014 Saudi–Qatari rift as a tangible political sign of a growing economic rivalry between oil and natural gas producers, which could "have deep and long-lasting consequences" beyond MENA.[69]

2017 Rift with Qatar
Main article: Qatar diplomatic crisis

On 5 June 2017, Bahrain, Saudi Arabia, UAE and Egypt had officially cut diplomatic ties with Qatar.[70] Saudi Arabia said it took the decision to cut diplomatic ties due to Qatar's "embrace of various terrorist and sectarian groups aimed at destabilising the region", including the Muslim Brotherhood, al-Qaida, ISIL and Iran-supported groups in Saudi Arabia's eastern province of Qatif.[71] Political researcher Islam Hassan viewed this as a continuation of Qatar's foreign policy rivalry with Saudi Arabia and UAE.[72][73][74]

In June 2017, Saudi Arabia, the United Arab Emirates, and Bahrain put a ban on Qataris and their businesses. Qataris are not allowed to enter or live in these countries unless they have a spouse living there, or they must carry a visa in order to enter these countries.[75]

Arabs States cooperation

Since the creation of the council in 1981 its membership has not expanded, with all members being Arab monarchies.[76]

Some GCC countries have land borders with Iraq, Jordan or Yemen, and sea borders with Iran, Egypt, Sudan, Eritrea or Somalia.

Egypt

Only the Sinai peninsula of Egypt lies in the Arabian peninsula. In 2011, Bahrain's Foreign Minister called for Egypt to be admitted as a member of the GCC.[77]

Iraq

Iraq is the only Arab country bordering the Persian Gulf that is not a member of the GCC. In 2012, Iraqi Defence Minister Saadoun al-Dulaimi stated that Iraq wanted to join the GCC.[78] Kuwait supports Iraq joining the GCC.[79] The lack of membership of Iraq is widely believed to be due to the low-income economy, its substantial Shia population, its republican political system, and its invasion of member state Kuwait during the Gulf War.

Iran

At the December 2012 Manama summit, the GCC states called for an end to Iranian interference in their internal affairs.[80]

Jordan and Morocco

In May 2011, Jordan's request to join the GCC, which had been first submitted 15 years earlier, was accepted and Morocco was invited to join the union.[81][82][83] In September 2011, a five-year economic plan for both countries was put forward after a meeting between the foreign ministers of both countries and those of the GCC states. Although a plan for accession was being looked into, it was noted that there was no timetable for either's accession, and that discussions would continue.[76]

As Jordan and Morocco are the only two Arab monarchies not currently in the council, the current members see them as strong potential allies. Jordan borders Saudi Arabia and is economically connected to the Persian Gulf States. Although Morocco is not near the Persian Gulf, the Moroccan foreign minister Taieb Fassi Fihri notes that "geographical distance is no obstacle to a strong relationship".[76]

Yemen

Yemen was in negotiations for GCC membership, and hoped to join by 2015. Although it has no coastline on the Persian Gulf, Yemen lies in the Arabian Peninsula and shares a common culture and history with other GCC members.[8] The GCC has already approved Yemen's accession to the GCC Standardization Authority, Gulf Organization for Industrial Consulting (GOIC),[84] GCC Auditing and Accounting Authority, Gulf Radio and TV Authority, GCC Council of Health Ministers, GCC Education and Training Bureau, GCC Council of Labour and Social Affairs Ministers, and Gulf Cup Football Tournament. The Council issued directives that all the necessary legal measures be taken so that Yemen would have the same rights and obligations of GCC member states in those institutions.[85]

In May 2017, the Gulf Cooperation Council rejected the formation of a transitional political council in southern Yemen, which called for the separation of Southern Yemen, siding with Yemen President Abd-Rabbu Mansour Hadi in doing so.[86]

The GCC members and Yemen are also members of the Greater Arab Free Trade Area (GAFTA). However, this is unlikely to affect the agenda of the GCC significantly as it has a more aggressive timetable than GAFTA and is seeking greater integration.

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See also

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Further reading
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